Hollinger starts tender for 11 7/8% notes

New York, Feb. 17 - Hollinger Inc. said it has begun two tender offers to buy for cash all its $120 million 11 7/8% senior secured notes due 2011.

One of the offers is a voluntary tender, the other a change-of-control tender.

In the voluntary offer, Hollinger will pay $1,250 per $1,000 principal amount of notes plus accrued interest up to but excluding the settlement date.

It is also soliciting consents to eliminate substantially all the restrictive covenants in the note indenture. Holders who tender by the consent deadline of 5 p.m. ET on March 3 will also receive a $30 per $1,000 consent payment.

The tender expires at 5 p.m. ET on March 18.

In the change-of-control offer, the Toronto owner of 72.4% voting and 30% equity interest in newspaper publisher Hollinger International Inc. will pay $1,010 per $1,000 principal amount plus accrued interest up to but excluding the settlement date.

The offer is being made as required under the Jan. 18 agreement between Press Holdings International Ltd., The Ravelston Corp. Ltd. and Lord Black of Crossharbour under which Press Holdings will acquire the Hollinger shares controlled by Ravelston and Black.

It expires at 5 p.m. ET on April 13.

The voluntary tender is subject to the receipt of consents and waivers from the holders of a majority of the principal amount of notes outstanding and the acquisition of Ravelston and Black's Hollinger shares.

Hollinger said that through the two offers it intends to acquire all the outstanding notes.

Press Holdings has agreed to make available funds to buy the notes.

UBS Investment Bank is dealer manager and solicitation agent.

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